Drivers of Globalization

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DRIVERS OF GLOBALIZATION[1]

ISHRAT HUSAIN

Having listened to distinguished luminaries such as Prof Ishwar Dayal there is hardly very much I can add or contribute to the discourse initiated this morning. But as a student of economics I know that I should stick to my comparative advantage. What I therefore propose to do this afternoon is to spell out what I consider are the main Drivers of Globalization . I would then argue that unless we understand those Drivers of Globalization we cannot have a picture of what the firms or business--- individually and collectively ---are going to look like in the future. Having done that , we delve into the realm of the changes in the the state of the firm which will emerge in the light of this globalization. We should then discuss as to what will be the challenges facing the management of firms in this globalized economy. Once we have grappled with these configurations we should be in a better position to sketch out the contours of management Education required in the future globalized world.

This is the analytical framework I propose for our discussion this afternoon. It is not very meaningful to start the conversation about Management Education without reference to the management challenges that the firms and businesses operating in the globalized economy would be faced with in the future. Management Education then responds to those needs and requirements and equips its graduates in meeting those challenges . I will start the ball rolling by dwelling upon the Drivers of Globalization.

I would submit that there are many competing theories and several hypotheses about the shape and form of globalization. There is no consensus at intellectual level about the impact of globalization. Some consider it as an evil that will create more misery for the weaker nations, fragile states and disadvantaged populations as well endowed nations, strong economies and large populous states pre-empt most of the benefits for themselves. Others feel that the dissipation of boundaries, dismantling of barriers and disappearances of borders would spread these benefits to majority of the people in all parts of the world. But at least one thing is quite obvious. We would face a lot of uncertainty during the course of coming decades. The recent financial crisis we witnessed in 2008-2009 has taken all of us by surprise. There were hardly any tremors felt before the financial tsunami engulfed all of us in its spate. Nobody had predicted the speed, intensity and extent of damage that came along with this crisis. So what is certain is that the world is going to be saddled with uncertainty, with unknowns, with imponderables, with unanticipated events which despite our best ability and foresight we are not able to predict. Its going to be a messy world, it is going to be a totally uncertain world and therefore the kind of firm which would survive under those circumstances would be one which is agile, nimble and quick in its response to the ever changing dynamic situation of the globe . The quest for fixed points, base lines, benchmarks and milestones would prove to be futile. Management Education should produce managers who are able to think on their feet and are able to exercise critical analytical ability to solve problem in face of incomplete information . Those who remain wedded to the practice of drawing conclusions about the future from their past experiences are most likely to get it wrong.

In my view as I see it today there are at least 6 Drivers of Globalization . I do not rule out the possibility that all of us can have our own set of Drivers of Globalization . But at least these are the Drivers of Globalization which I see as formidable in today’ s world but they may change tomorrow or we may subtract or add to this list.

1. The first and the most important- there is a huge Demographic Transition which has already started but is...
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